Nevada Life and Health QUESTIONS &
ANSWERS(RATED A+)
COBRA (because she can convert, and if she has a long term illness it it will be hard for
her to get approved for individual insurance) - ANSWER Kevin and Nancy are married;
Kevin is the primary breadwinner and has a health insurance policy that covers both him
and his wife. Nancy has an illness that requires significant medical attention. Kevin and
Nancy decide to legally separate, which means that Nancy will no longer be eligible for
health insurance coverage under Kevin. Which of the following options would be best
for Nancy at this point?
a)COBRA
b)Apply for social security benefits
c)Apply for coverage under the same group policy that covers Kevin
d)Convert to an individual insurance policy with 31 days so she won't have to provide
evidence of insurability
Ownership - ANSWER What is the major difference between a stock company and a
mutual company?
Increasing Term - ANSWER What type of insurance would be used for a Return of
Premium rider?
a)Decreasing Term
b)Annually Renewable Term
c)Increasing Term
d)Level Term
Elimination Period - ANSWER In disability income insurance, the time between the
onset of an injury or sickness and when benefits begin
qualifying events include the voluntary termination of employment; an employee's
change from full time to part time; or the death of the employee, divorce - ANSWER
Qualifying Events for COBRA
36 months - ANSWER What is the period of coverage for events such as death or
divorce under COBRA?
First-Dollar Insurance Coverage - ANSWER Insurance where the insured is not required
to pay a deductible
Adverse Selection - ANSWER insuring of risks more prone to loss than average risk
Agent/Producer - ANSWER a legal representative of an insurance company
Applicant/Proposed insured - ANSWER a person applying for insurance
,Hazard - ANSWER conditions that increase the probability of a loss
indemnity - ANSWER restoring the insured to the condition that existed before loss
insurance - ANSWER transfer of risk of loss from an individual to an insurer
insurance transaction - ANSWER solicitation, negotiations, or effectuation of a contract
insured - ANSWER the person covered by the insurance policy
insurer - ANSWER the company that issues an insurance policy
law of large numbers - ANSWER the larger the number of people with the same
exposure to loss, the more predictable the actual loss will be
peril - ANSWER the cause of loss
policyowner - ANSWER the person who has the rights and privileges in the policy
risk - ANSWER uncertainty or chance of loss
beneficiary - ANSWER the person who receives the benefits from an insurance policy
death benefit - ANSWER the amount paid upon the insured's death
estate - ANSWER a persons' net worth
life insurance - ANSWER coverage on human lives
cash value - ANSWER a policy's savings element or living benefit
face amount - ANSWER the amount of benefit stated in the life insurance policy
permanent insurance - ANSWER builds cash value and remains in effect for the entire
life of the insured
term insurance - ANSWER temporary protection
options - ANSWER ways to invest or distribute a sum of money available in a policy
provisions - ANSWER the rights and obligations within a contract
riders - ANSWER these modify policy provisions
accumulation period (pay-in period) - ANSWER premiums are paid into an annuity
,annuitant - ANSWER a natural person whose life expectancy is taken into consideration
and who receives annuity payments
Annuitization period (liquidation, pay-out period) - ANSWER income is paid to the
annuitant
annuity - ANSWER A contract that provides income for a specified period of time or for
life; NOT life insurance
earned income - ANSWER salary, wages, or commissions; but NOT income from
investments, unemployment benefits, workers comp, and similar sources of income
qualified plan - ANSWER A retirement plan that meets the IRS guidelines for receiving
favorable tax treatment.
tax deferred - ANSWER withheld or postponed until a specified time in the future
policy proceeds - ANSWER the death benefit
rollover - ANSWER tax free distribution of cash from one qualified plan to another
surrender - ANSWER early termination of a policy by the policyowner
accidental bodily injury - ANSWER unforeseen and unintended injury from an accident
coinsurance - ANSWER cost sharing by the policyowner and the insurer (a percentage)
deductible - ANSWER the amount of covered expenses paid by the policyowner before
the policy pays
pre-existing condition - ANSWER condition for which the insured received diagnosis. or
treatment prior to the policy issue
sickness - ANSWER illness or disease that manifests itself while the policy is in force
Attending Physician's Statement - ANSWER a statement about the applicant's medical
conditions, diseases, and treatments obtained from the applicant's doctor
Medical Information Bureau (MIB) - ANSWER nonprofit organization that receives
adverse medical information from insurers and helps in their underwriting
benefit period - ANSWER a period of time for the monthly disability benefit payments
closed panel - ANSWER Physicians provide services exclusively to members of a
health organization
, fee-for-service - ANSWER plans where providers receive a payment for billed charges
for each service
medical expense insurance - ANSWER Insurance that reimburses the policyowner for
hospital and medical costs
open panel - ANSWER physicians provide services to a health organization and its
subscribers, but retain the right to treat nonmembers
prepaid - ANSWER Plans where providers are compensated regularly regardless of the
services provided
Subscriber (participant, member) - ANSWER an individual signed up for a prepaid plan
activities of daily living (ADLs) - ANSWER bathing, continence, dressing, eating,
toileting, and transferring
open enrollment - ANSWER annual general enrollment period, Jan 1 through March 31
any occupation - ANSWER the insured is unable to perform any duties of the
occupation for which he/she is suited by education, training, or experience
nonoccupational coverage - ANSWER Claims that result from accidents or sicknesses
that occur off the job
occupational coverage - ANSWER benefits for illness, injury, or disability resulting from
accidents or sicknesses that occur on or off the job
own occupation - ANSWER the insured is unable to perform any duties of his/her own
occupation
contributory plan - ANSWER the employee pays part of or the entire premium
noncontributory plan - ANSWER the employer pays the entire premium
agent - ANSWER a licensed person who solicits insurance on behalf of an insurance
company (represents the insurer)
broker - ANSWER a licensed person who represents the insured
All of the above - ANSWER An advertisement must accurately represent which of the
following?
a)The insurer's assets
b)The insurer's corporate structure
ANSWERS(RATED A+)
COBRA (because she can convert, and if she has a long term illness it it will be hard for
her to get approved for individual insurance) - ANSWER Kevin and Nancy are married;
Kevin is the primary breadwinner and has a health insurance policy that covers both him
and his wife. Nancy has an illness that requires significant medical attention. Kevin and
Nancy decide to legally separate, which means that Nancy will no longer be eligible for
health insurance coverage under Kevin. Which of the following options would be best
for Nancy at this point?
a)COBRA
b)Apply for social security benefits
c)Apply for coverage under the same group policy that covers Kevin
d)Convert to an individual insurance policy with 31 days so she won't have to provide
evidence of insurability
Ownership - ANSWER What is the major difference between a stock company and a
mutual company?
Increasing Term - ANSWER What type of insurance would be used for a Return of
Premium rider?
a)Decreasing Term
b)Annually Renewable Term
c)Increasing Term
d)Level Term
Elimination Period - ANSWER In disability income insurance, the time between the
onset of an injury or sickness and when benefits begin
qualifying events include the voluntary termination of employment; an employee's
change from full time to part time; or the death of the employee, divorce - ANSWER
Qualifying Events for COBRA
36 months - ANSWER What is the period of coverage for events such as death or
divorce under COBRA?
First-Dollar Insurance Coverage - ANSWER Insurance where the insured is not required
to pay a deductible
Adverse Selection - ANSWER insuring of risks more prone to loss than average risk
Agent/Producer - ANSWER a legal representative of an insurance company
Applicant/Proposed insured - ANSWER a person applying for insurance
,Hazard - ANSWER conditions that increase the probability of a loss
indemnity - ANSWER restoring the insured to the condition that existed before loss
insurance - ANSWER transfer of risk of loss from an individual to an insurer
insurance transaction - ANSWER solicitation, negotiations, or effectuation of a contract
insured - ANSWER the person covered by the insurance policy
insurer - ANSWER the company that issues an insurance policy
law of large numbers - ANSWER the larger the number of people with the same
exposure to loss, the more predictable the actual loss will be
peril - ANSWER the cause of loss
policyowner - ANSWER the person who has the rights and privileges in the policy
risk - ANSWER uncertainty or chance of loss
beneficiary - ANSWER the person who receives the benefits from an insurance policy
death benefit - ANSWER the amount paid upon the insured's death
estate - ANSWER a persons' net worth
life insurance - ANSWER coverage on human lives
cash value - ANSWER a policy's savings element or living benefit
face amount - ANSWER the amount of benefit stated in the life insurance policy
permanent insurance - ANSWER builds cash value and remains in effect for the entire
life of the insured
term insurance - ANSWER temporary protection
options - ANSWER ways to invest or distribute a sum of money available in a policy
provisions - ANSWER the rights and obligations within a contract
riders - ANSWER these modify policy provisions
accumulation period (pay-in period) - ANSWER premiums are paid into an annuity
,annuitant - ANSWER a natural person whose life expectancy is taken into consideration
and who receives annuity payments
Annuitization period (liquidation, pay-out period) - ANSWER income is paid to the
annuitant
annuity - ANSWER A contract that provides income for a specified period of time or for
life; NOT life insurance
earned income - ANSWER salary, wages, or commissions; but NOT income from
investments, unemployment benefits, workers comp, and similar sources of income
qualified plan - ANSWER A retirement plan that meets the IRS guidelines for receiving
favorable tax treatment.
tax deferred - ANSWER withheld or postponed until a specified time in the future
policy proceeds - ANSWER the death benefit
rollover - ANSWER tax free distribution of cash from one qualified plan to another
surrender - ANSWER early termination of a policy by the policyowner
accidental bodily injury - ANSWER unforeseen and unintended injury from an accident
coinsurance - ANSWER cost sharing by the policyowner and the insurer (a percentage)
deductible - ANSWER the amount of covered expenses paid by the policyowner before
the policy pays
pre-existing condition - ANSWER condition for which the insured received diagnosis. or
treatment prior to the policy issue
sickness - ANSWER illness or disease that manifests itself while the policy is in force
Attending Physician's Statement - ANSWER a statement about the applicant's medical
conditions, diseases, and treatments obtained from the applicant's doctor
Medical Information Bureau (MIB) - ANSWER nonprofit organization that receives
adverse medical information from insurers and helps in their underwriting
benefit period - ANSWER a period of time for the monthly disability benefit payments
closed panel - ANSWER Physicians provide services exclusively to members of a
health organization
, fee-for-service - ANSWER plans where providers receive a payment for billed charges
for each service
medical expense insurance - ANSWER Insurance that reimburses the policyowner for
hospital and medical costs
open panel - ANSWER physicians provide services to a health organization and its
subscribers, but retain the right to treat nonmembers
prepaid - ANSWER Plans where providers are compensated regularly regardless of the
services provided
Subscriber (participant, member) - ANSWER an individual signed up for a prepaid plan
activities of daily living (ADLs) - ANSWER bathing, continence, dressing, eating,
toileting, and transferring
open enrollment - ANSWER annual general enrollment period, Jan 1 through March 31
any occupation - ANSWER the insured is unable to perform any duties of the
occupation for which he/she is suited by education, training, or experience
nonoccupational coverage - ANSWER Claims that result from accidents or sicknesses
that occur off the job
occupational coverage - ANSWER benefits for illness, injury, or disability resulting from
accidents or sicknesses that occur on or off the job
own occupation - ANSWER the insured is unable to perform any duties of his/her own
occupation
contributory plan - ANSWER the employee pays part of or the entire premium
noncontributory plan - ANSWER the employer pays the entire premium
agent - ANSWER a licensed person who solicits insurance on behalf of an insurance
company (represents the insurer)
broker - ANSWER a licensed person who represents the insured
All of the above - ANSWER An advertisement must accurately represent which of the
following?
a)The insurer's assets
b)The insurer's corporate structure
